Gaming

Gaming

The act or practice of gambling; an agreement between two or more individuals to play collectively at a game of chance for a stake or wager, which will become the property of the winner and to which all involved make a contribution.

Since the early 1990s, gaming laws have been in a constant state of flux. Regulation of gaming is generally reserved to the states, but the U.S. Congress became involved in it in 1988 with the passage of the Indian Gaming Regulatory Act (Gaming Act) (Pub. Law. No. 100-497, 102 Stat. 2467 [25 U.S.C.A. § 2701 et seq.] [Oct. 17, 1988]), which brought tribal gaming under the regulation of state and federal governments.

Before the 1990s, most gaming was illegal in a majority of states. Since the passage of the Gaming Act, many state legislatures have approved gaming in a variety of forms. Some states still outlaw all but charitable gambling, but most have expanded their definition of legal gaming operations to promote economic development.

The Legal History of gambling in the United States is marked by dramatic swings between prohibition and popularity. In colonial times, games of chance were generally illegal except for state and private lotteries. Other gaming was considered a sin and not fit for discussion in polite society. In the early nineteenth century, the popular belief changed from seeing gaming as a sin to seeing it as a vice. Gamblers were no longer considered fallen in the eyes of God but were now seen as simply victims of their own weaknesses.

Gaming came under renewed attack during the presidency of Andrew Jackson (1829– 37). Part of the "Jacksonian morality" of the period revived the view of gambling as sinful. By 1862, gaming was illegal in all states except Missouri and Kentucky, both of which retained state lotteries.

After the Civil War, legal gaming experienced a brief renaissance, only to fall out of favor again in the 1890s. At this point, it was outlawed even in the western territories, where card games such as poker and blackjack had become a regular diversion in frontier life. By 1910, the United States was again virtually free of legalized gaming. Only Maryland and Kentucky allowed gambling, in the sole form of horse race betting.

In 1931, Nevada re-legalized casino gaming. Many states followed this lead in the 1930s by legalizing pari-mutuel betting, wherein all bets are pooled and then paid, less a management fee, to the holders of winning tickets. In 1963, New Hampshire formed the first State Lottery since the 1910s. By the 1990s, gaming was the largest and fastest growing segment of the U.S. entertainment industry. In 1992, for example, U.S. citizens spent approximately four times more on gaming than on movies. Gaming is still illegal in some states, but most states have at least one form of legal gambling, most commonly a state-run lottery. In fact, instead of prohibiting gaming, many states now actively promote it by sponsoring lotteries and other games of chance.

Gaming laws vary from state to state. Idaho, for example, declares that "gambling is contrary to public policy and is strictly prohibited except for" pari-mutuel betting, bingo and raffle games for charity, and a state lottery (Idaho Const. art. III, § 20). Like lotteries in other states, the purpose of the one in Idaho is to generate revenue for the state. The lottery is run by the Idaho State Lottery Commission, which oversees all aspects of the game, including expenses and advertising.

In addition to lotteries, some states with direct access to major river systems or lakes expanded their venues for gaming to include riverboats. On July 1, 1989, Iowa became the first state to authorize its Racing and Gaming Commission to grant a license to qualified organizations for the purpose of conducting gambling games on excursion boats in counties where referendums have been approved. Illinois quickly followed Iowa with its Riverboat Gambling Act (230 ILCS 10), which went into effect on February 7, 1990. Four more states subsequently passed legislation permitting licensing for riverboat casinos: Indiana, Louisiana, Mississippi, and Missouri. Some riverboat gambling vessels are permanently docked while others embark on brief cruises and return to their docks after several hours of gaming, dining, and entertainment for passengers.

Alabama is one of the few states that prohibit all gambling except for charitable gaming. Alabama maintains no state lottery and punishes gambling through criminal statutes. Under the Code of Alabama, sections 13A-12-24 and 13A-12-25 (1975), the possession of gambling records is a class A misdemeanor, which carries a penalty of not more than one year in jail or a $2,000 fine, or both.

Nevada is the most permissive state for gambling. Its public policy of gaming holds that "[t]he gaming industry is vitally important to the economy of the state and the General Welfare of the inhabitants" (Nev. Rev. Stat. § 463.0129). Nevada statutes allow the broadest range of gaming activities, including pari-mutuel betting, betting on sports competitions and other events, and the full panoply of casino games. Gambling is heavily regulated by the Nevada Gaming Commission, and a wide range of criminal statutes are designed to ensure cooperation with the regulations of the commission.

New Jersey is another active promoter of gaming. In 1976, New Jersey voters passed a Referendum approving casino gaming, and that decision was codified in the Casino Control Act (N.J. Stat. Ann. § 5:12-1 et seq.). Gaming is limited to Atlantic City, and it does not include betting on sports events other than horse and dog races. However, like Nevada, New Jersey offers the full array of casino games.

The Gaming Act divides all gambling into three classes. Class I includes all traditional Indian games performed as a part of, or in connection with, tribal ceremonies or celebrations. Class II is limited to bingo, pull tabs, and card games not explicitly prohibited by the laws of the state. Class III encompasses all other forms of gambling, such as slot machines, poker, blackjack, dice games, off-track betting (where bets may be placed by persons not at the race track) and pari-mutuel betting on horses and dogs, and lotteries.

An Indian tribe may operate a class I game without restrictions. It may offer class II games with the oversight of the National Indian Gaming Commission, and class III games only if it reaches an agreement with the state in which it resides.

The Gaming Act provides that Native American tribes may operate high-stakes casinos only if they reach an agreement with the state in which they reside. Under the act, a state is required to enter into Good Faith negotiations with a federally recognized tribe to allow class III gaming that was legal in the state before the negotiations began. For example, if a state has legalized blackjack but not poker, blackjack is available for negotiations but not poker. Furthermore, when a state approves a new form of gambling, the state must make the new game available in negotiations with native tribes.

Native American groups have criticized the Gaming Act as interfering with tribal sovereignty. Indeed, a primary purpose of the act was to reconcile state interests in gaming with those of the tribe's. Before the act, some Native American tribes ran sizable gambling operations on their land without regulation by the federal or state governments.

The Gaming Act has also created opposition in some states that seeks to minimize gambling within their boundaries. Maine, for example, refused to give the Passamaquoddy tribe a license to conduct class III gaming operations on tribal land in Calais, near the Canadian border. The tribe sued the state for the right to conduct the high-stakes gaming. However, several years earlier, Maine had given the tribe land in exchange for the tribe's agreement to submit to state jurisdiction. In Passamaquoddy Tribe v. Maine, 1996 WL 44707, 75 F. 3d 784 (1st Cir. 1996), the First Circuit Court of Appeals ruled against the tribe. The court noted that Congress had been aware of Maine's agreement with the tribe and that Congress could have added to the Gaming Act, but chose not to, language making the act applicable to the state of Maine. According to the court, the gaming statute did not erase the 1980 agreement between the tribe and the state, and Maine had the right to refuse the tribe's request.

Further readings

American Gaming Association. Available online at <www.americangaming.org> (accessed July 26, 2003).

Cross-references

GAMING. A contract between two or more persons by which they agree to play
by certain rules at cards, dice, or other contrivance, and that one shall be
the loser, and the other the winner. When considered in itself, and without
regard to the end proposed by the player's, there is nothing in it contrary
to natural equity, and the contract will be considered as a reciprocal gift,
which the parties make of the thing played for, under certain. conditions.
2. There are some games which depend altogether upon skill, others,
upon chance, and some others are of a mixed nature. Billiards is an example
of the first; lottery of the second; and backgammon of the last.
3. In general, at common law all games are lawful, unless some fraud
has been practiced, or such games are contrary to public policy. Each of the
parties to the contract must, 1. Have a right to the money or thing played
for. 2. He must have given his full and free consent, and not been entrapped
by fraud. 3. There must be equality in the play. 4. The play must be
conducted fairly. But even when all these rules have been observed, the
courts will not countenance gaming by giving too easy a remedy for the
recovery of money won at play. Bac. Ab. h. t. A.
4. But when fraud has been practiced, as in all other cases, the
contract is void and in some cases, when the party has been guilty of
cheating, by playing with false dice, cards and the like, he may be indicted
at common law, and fined and imprisoned, according to the heinousness of the
offence. 1 Russ. on Cr, 406.
5. Statutes have been passed in perhaps all the states forbidding
gaining for money, at certain games, and prohibiting the recovery of money
lost at such games. Vide Bac. Ab. h. t.; Dane's Ab. Index, h. t.; Poth.
Traite du Jeu; Merlin, Repertoire, mot Jeu; Barbeyrac, Traite du Jeu, tome
1, p. 104, note 4; 1 P. A. Browne's Rep. 171: 1 Overt. R. 360; 3 Pick. 446;
7 Cowen, 496; 1 Bibb, 614; 1 Miss. 635; Mart. & Yerg. 262; 1 Bailey, 315; 6
Rand. 694; 8 Cowen, 139; 2 Blackf. 251; 3 Blackf. 294; and Stakeholder;
Wagers.

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